In Michigan Visit, President Trump Reopens Review of Fuel-Economy Standards

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In his visit to a site that’s being transformed into a proving ground for the autonomous future, President Trump pined for a return to the automotive industry’s past.

Calling for a “new industrial revolution” on Wednesday during a stop in suburban Detroit, Trump promised an audience filled with industry executives and union workers that revamped trade agreements and a reduction in federal regulations will increase factory jobs and buoy an industry already selling cars at or near record highs.

“We want to be the car capital of the world again, and it won’t be long, believe me,” Trump told the assembled crowd at the American Center for Mobility, an autonomous and connected-car testing facility currently being constructed on the grounds of the Willow Run Assembly Plant where thousands of Rosie the Riveters churned out B-24 Liberators during World War II.

One way the president said he intends to redirect the industry’s efforts is by revisiting the fuel-economy standards finalized in the last days of the Obama administration. Prior to Trump’s remarks Wednesday, the Environmental Protection Agency announced it would reopen the midterm evaluation process of Corporate Average Fuel Economy (CAFE) standards, which the previous administration upheld at 54.5 miles per gallon by model year 2025.

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“I ask you today to join me in daring to believe that this facility, this city, and this nation will once again shine with industrial might.” – President Trump

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The Auto Alliance, the main lobbying arm of the industry, has praised the decision to reinstate the review, which now reverts back to its originally scheduled time frame, which called for completion by April 1, 2018. In a letter sent to new EPA chief Scott Pruitt last month, Alliance CEO Mitch Bainwol wrote that the cost of the standards has exceeded the $200 billion initially estimated and driven up the price of vehicles. Currently, the Auto Alliance is only endorsing the restart of the review process. It is not yet endorsing a change in the determination.

While some Democrats and environmental groups expressed disappointment in the reopening of this issue, others think there’s an opportunity to modernize the standards—which were set in place five years ago and written even earlier—by marrying efficiency goals with the deployment of autonomous vehicles.

President Donald Trump delivers remarks at the American Center for Mobility in Ypsilanti, Michigan, accompanied by General Motors CEO Mary Barra and other auto-industry executives.

Securing America’s Future Energy (SAFE), a nonpartisan think tank that explores energy and transportation policy with the goal of promoting economy and national security, believes a broader focus on the entire mobility system, rather than individual vehicles, will result in reductions in oil demand as well as less burdensome regulations.

“Every American president since Richard Nixon has sought to break U.S. oil dependence and achieve true energy security,” the organization said in a report issued this month in advance of the midterm review reopening. “Today, we have the opportunity to implement a strategy that protects the nation, creates jobs, protects human health, and keeps America on the forefront of the new technology.”

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“A number of CEOs reiterated that it is important for the U.S. to maintain its focus and leadership around automation.”– John Maddox, CEO, American Center for Mobility

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As for autonomous cars, SAFE says regulators should incentivize software developers to create algorithms that improve fuel efficiency and measure gains from smarter traffic routing and crash reductions. The organization also says that shared vehicles—autonomous or otherwise—could put up to 10 times as many miles on their odometers per year as privately owned vehicles. Standards could recognize the increased impact of shared vehicles and promote their deployment by increasing their representation in calculating fleet-wide average fuel economies.

No Public Statement from Trump about Autonomous Vehicles

Trump did not mention autonomous vehicles in his public remarks Wednesday, a curious omission considering his location. But John Maddox, CEO of the American Center for Mobility, said the subject came up during a roundtable discussion Trump held with the CEOs of Detroit’s major automotive companies and Secretary of Transportation Elaine Chao before his public remarks.

Fuel economy and auto-related jobs were the primary topics, but “the president did ask some questions about how autonomous vehicles fit in with the future workforce and jobs in general, and a number of CEOs reiterated that it is important for the U.S. to maintain its focus and leadership around automation, particularly so that the U.S. remains competitive,” Maddox said.

Maddox showcased plans for the fledgling facility, on which construction began in November 2016. The first phase of the 335-acre center, a loop around the basic perimeter that will be used for highway-style testing, is expected to open in late 2017. Longer-term plans include, among other items, a home for a national cybersecurity research center, a high-speed intersection, and sensors to test dedicated short-range communications and 5G networks.

Trump has proposed up to $1 trillion in federal spending to modernize the country’s infrastructure. While the president has not articulated whether a portion of that funding could help the nation get ready for the arrival of autonomous vehicles, Maddox did highlight its importance for advanced transportation technologies.

“We had a chance to talk a little bit about what we’re doing here, and building a place for these same companies to do their product development and speed the process by which we create voluntary standards,” he said. “Our conversation did not center on that, but I did bring up infrastructure as it relates to autonomous vehicles.”

At least for the time being, the president’s primary focus was on the present day. His public remarks, his first as president in a state he won by 10,704 votes in the November election, concentrated on revisiting fuel-economy standards and sparking increases in auto-related employment.

“I ask you today to join me in daring to believe that this facility, this city, and this nation will once again shine with industrial might,” Trump said. “I’m asking you to place your faith in the American worker and these great American companies.”